Legal Principles to be Applied in Proceedings Related to Arbitration Explained by Supreme Court

Legal Principles to be Applied in Proceedings Related to Arbitration Explained by Supreme Court

Dealing with a case of execution of an arbitral award under Arbitration and Conciliation Act, 1996 it is held connecting it with S.47 of Code of Civil Procedure, 1908 that "object of Section 47 is to prevent unwarranted litigation and dispose of all objections as expeditiously as possible. There is a steady rise of proceedings akin to a retrial which causes failure of realization of the fruits of a decree, unless prima facie grounds are made out entertaining objections under Section 47 would be an abuse of process."

An objection petition under Section 47 should not invariably be treated as a commencement of a new trial.

At the stage of execution, an objection as to executability of the decree can be raised, limited to the ground of jurisdictional infirmity or voidness. It has been further held that errors of facts and law cannot be the subject matter of objection under Section 47. 

Whether in Government, Public Sector Corporations or even in the private sector, the driving force of the entity are the persons who administer them. A certain play in the joints is inevitable for their day-to-day functioning. If they are shackled with the fear that, their decisions taken for the day-to-day administration, could years later with the benefit of hindsight, be viewed with a jaundiced eye, it will create a chilling effect on them. A tendency to play it safe will set in. Decision making will be avoided. Policy paralysis will descend. All this will in the long run prove detrimental not just to that entity but to the nation itself. 

Reference : MMTC Ltd v. Anglo American Metallurgical Coal Pvt Ltd [2025] GCtR 1644 (SC)